Attorney
General J. Joseph Curran, Jr. says consumers should shop around
before signing up with a credit counseling company to repay their
debts. In the latest issue of his Consumer's
Edge newsletter, Curran said that some consumers have been
hurt by hidden fees and by sloppy practices that resulted in late
or missed payments to the consumers' creditors. Others have been
misled by companies that advertised debt management but actually
steered clients to take out consolidation loans.

Companies
offering such plans usually promise that they will get the consumer's
creditors to reduce interest rates and accept smaller payments,
and the consumer will only have to make one monthly payment. However,
Curran said that some companies impose hefty fees disguised as voluntary
"contributions" from the consumer. Many consumers have
complained that they were never told about these "contributions"
and were angry when the money they paid did not go to their creditors,
but to the credit counseling company.

Curran
advises consumers considering a debt repayment plan to:


Look for a plan that does not require or request fees or "contributions."


Call the Attorney General's Consumer Protection Division to see
if other consumers have filed complaints against the company, and
find out how long it has been in business.


Read the agreement carefully to understand how it works and what
your responsibilities are.


Follow up with creditors, to be sure they have agreed to accept
the plan and are receiving payments.

"Although
these services promise to make things easier for you, you can't
just write the check and think that everything is taken care of,"
Curran said. "You need to ask a lot of questions and follow
up to be sure your creditors are being paid."

Consumers
can request a copy of the Consumer's Edge on debt repayment
plans by calling (410) 576-6500.